ADMS 3530 Study Guide - Final Guide: Capital Asset Pricing Model, Standard Deviation, Tetrafluoromethane

• School: York University
• Department: Administrative Studies
• Course: ADMS 3530
• Professor: Lois King

Document Summary

Option a) fv formula and bring all cash flows to t=2 or. Option b) pv formula and bring all cash flows to t=0. Option a) bring all cash flows to t=2 (use fv or compound) 200(1. 04)2 + y (1. 04) + 2400 = 3032. 32. Option b) bring all cash flows to t=0 (use pv and discount) 200 + y/(1 + r)1 + 2400/(1 + r)2 = 3032. 32/ (1 + r )2. Pmt = , i = 9, n= 4, fv =0, comp pv. Using your calculator: pmt = . 33, n = 12, pv = ,000, fv=0, comp i . The monthly interest rate is given by: (1 + im )12 = 1 + ear = (1 + 3125%) = 1. 076406, that is im = 0. 5142% Mortgage remaining at the end of 5 years 240 months remaining: Pmt = . 22, n=240, i=. 5142, fv=0, comp pv. Solution: current yield = annual coupon payment/ bond price.